Blog Archives

Yesterday, Governor Tom Corbett unveiled his budget proposal which will inevitably be tinkered and toyed with until the General Assembly passes their final version in the end of June, but it made clear the hopes and dreams of Governor Corbett in the coming fiscal year.

Last year, Corbett proposed major cuts to education and paid for it with his approval rating. He hasn’t made the same mistake this year. Corbett proposed a 1.7 percent increase to basic education funding and promised $1.6 billion to higher education. However, these funding increases are not yet a foregone conclusion. The spending increase is tied to several other reform projects that Corbett has his eye on. Education funding will be tied to the privatization of state liquor stores, a greatly debated issue in the past few years. Without this reform, budget officials say that major cuts are inevitable. Public schools would be forced to choose between increasing their taxes, cutting their programs or an unfortunate combination of the two.

Funding for transportation will also be increased in a similar deal. Over the next five years, $5.3 billion is to be invested in transit with $510 million immediately going to highway and bridge projects if the legislature votes to reform the state pension system. The proposed reform would do nothing to reduce the benefits that current employees have already paid, but the future of their plan would switch to a 401(k) program in which they allocate 6.25 percent of their salary to their retirement benefits. New state employees would enter the pension system with this program in place.

New employees to the state may be sparse though; Corbett’s budget includes the elimination of 900 positions, including 400 layoffs. Most of these staff reductions will come from the Department of General Services, the Health Department and Public Welfare. In Human Services news, Corbett has proposed $6.1 million to transition patients at state facilities to community placements.

Despite the spending increases, this budget proposal is also business friendly. It eliminates the Capital Stock and Franchise Tax, reduces the Corporate Net Income Tax and repeals the Corporate Loan Tax. Small businesses certainly weren’t left out of business benefits either. They are now eligible to a $5,000 tax deduction for start-up businesses and access to a new team within the Department of Community and Economic Development that will provide advice on how to best utilize state and local incentives to increase the success rate of new businesses. The Pennsylvania Business Development Authority will consolidate eight loan programs into one large pool of $1.1 billion loan funds.

The Republicans control both the state house and senate, but it is unlikely that Corbett will get everything that he asked for in this proposal. However, it will certainly shape the debate in the coming months before the 2012-2013 fiscal year expires.

Yesterday, Governor Rendell signed the $28 Billion 2010-2011 state budget. With all sorts of media coverage on the budget process and implications, it can be challenging to keep it all straight. Here is a brief overview of some of the information that is out there. If you have additional links, feel free to post them below.

KDKA- The local ‘CBS 2’ news station out of Pittsburgh provides a short and to-the-point overview of the budget.

• About 1% increase over last year’s budget
• No income or sales tax increase
• No increase in cigarette tax
• No new tax on cigars and smokeless tobacco
• New severance tax on Marcellus Shale natural gas drilling
• Government operating costs 14% lower than in Rendell’s first year in office
• Basic education subsidy to school districts will increase 4.5% ($250M)

Morning Call- The Morning Call briefly discusses the budget’s increase in education support and the cut funding to libraries, state parks/forests, and environmental protection efforts. Mostly, the MC focuses on the two construction projects approved for honoring Senators Spector and Murtha. Critics argue that now is a bad time to spend state funds on such projects while the Governor contends that the money is “bond money” (which cannot be used for operating expenses) and will generate jobs.

Philadelphia Inquirer– The Inquirer outlines the discussion that has broken out following the signed budget. The article focuses on the $20 million allotted for new construction honoring Senators Murtha and Spector, and $141 million for projects in Philadelphia and surrounding areas. All $161 million of this money comes from the $600 million pot of bond money, of which the Governor decides how to spend half. All $161 million of budgeted spending has also been criticized by those who feel that construction of such projects is untimely or not appropriately detailed. The article also provides a succinct overview of some of the key budget details:

The $28 billion state budget that Rendell signed Tuesday holds the line on spending, adds no new taxes, makes cuts across most state agencies, and anticipates layoffs of about 1,000 state workers. It also relies on $850 million in additional federal Medicaid funding that has not yet been approved by Congress and faces an uphill battle when members return to work later this month.

Patriot News- In this article, the Patriot-News Editorial Board lays out some next steps for PA legislators following the completion of the budget. Included in the discussion are transportation concerns, juvenile justice, and texting bans.

PR Newswire- “Governor Rendell Signs Jobs Bill to Spur $1.2 Billion Investment in PA’s Economy, Create 18,000 Jobs” PR Newswire details a bill signed as a part of the 2010-2011 budget package authorizing funding through the Redevelopment Assistance Capital Program. The Governor claims that this program will have a positive impact on every region of the commonwealth.

This only covers some of what is being said. If you have seen other coverage that does a great job of articulating the details of the budget or highlights the implications of certain content, please post it as a comment below.

House Republican Whip Eric Cantor (R-VA) has targeted the federal Safe Routesto School program established under the 2005 Federal Surface Transportation Bill (SAFETEA-LU) as wasteful government spending in his weekly “YouCut program”.

Each week representative Cantor asks people to vote for which of five options they would cut from the federal budget. Republicans then hold a floor vote in the House of Representatives to try to eliminate the program that gets the most votes.

This week, the federal Safe Routes to School program is one of Rep. Cantor’s targets. He argues that SRTS duplicates other bicycling and walking programs, and that bicycling and walking infrastructure is a local government responsibility.

As you may know, the Safe Routes to School (SRTS) program aims to make walking and bicycling to school safer and more accessible for children, including those with disabilities, and to increase the number of children who choose to walk and bicycle. On a broader level, SRTS programs can enhance children’s health and well-being, ease traffic congestion near the school and improve air quality and improve community members’ overall quality of life.